The entities in the hierarchy can depict any aspect of the decision situation―it can be implicit or explicit, exactly monitored or approximated guess, thoroughly or partially represented, completely or poorly understood―anything at all that fits into the dilemma on hand. The process of AHP begins by converting an existing decision dilemma into a hierarchy of easily deciphered and understood sub-problems, each of which can then be analyzed independently. Though the concept of hierarchy is easily grasped intuitively, it can also be described mathematically. A hierarchy is a stratified system of ranking and organizing people, things, ideas, etc., where each element of the system, except for the top one, is subordinate to one or more other elements. The first step in the analytic hierarchy process is to model the problem as a hierarchy. Rather than prescribing a correct decision, the AHP helps decision makers find one that best suits their goal and their understanding of the problem. ĪHP has particular application in group decision making and is used around the world in a wide variety of decision situations, in fields such as government, business, industry, healthcare, shipbuilding and education. This technique facilitates a logical and comprehensive structured framework for framing a decision dilemma, for representing and quantifying its criteria, for relating those criteria into overall objectives, and for evaluating alternative options and solutions. It is a structured technique for organizing and analyzing complex decisions, based on mathematics and psychology. Saaty in the 1970s and has been extensively studied, analyzed and refined since its inception. The applicability of the AHP Model is demonstrated with anĪnalytic hierarchy process (AHP) was developed by Thomas L. Structured methodology culled out from varied disciplines of economics, psychologyĪnd mathematics. Solution to the perennial subjective decision making process in the form of a The outcome of the study is a mathematical ![]() To grasp the basics of decision making and decision analysis and to useĭecision making and decision analysis in assessing the scope for cost-reduction The interrelationship between considered criteria and available alternatives, The objectives of the article are to understand Weight or priority is derived for each element of the hierarchy, allowingĭiverse and often incommensurable elements to be compared to one another in a ![]() AHP converts comparative evaluations to numerical values thatĬan be processed and weighed over the entire range of the problem. The paper presents one suchĭecision making tool called Analytical Hierarchical Process (AHP), a techniqueįor complex decision making used for large-scale, multi-party, multi-criteriaĭecision analysis. The category of multiple criteria decision making. Number of very effective decision tools have been suggested which falls under Has been conducted in past few decades on economics of decision making. SinceĪges decision making has always intrigued the mankind. Decision making in any field, like all otherĮconomic issues, involves allocating scarce resources to meet various needs.
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